Online reward point exchange method and system with user bids of rewards for purchase of a product

Abstract

An online reward exchange system and method of operation, which includes an exchange computer that interoperates via a computer network with user computers, reward point issuer computers, and merchant computers. The merchants' products may be purchased by a user by requesting an issuer(s) to redeem reward points in exchange for payment to the merchant for the product. The exchange computer is the gateway to the system and manages various transactions such as providing online product catalogs to users that list the merchants products, as well as displaying to the user the reward points he has available in his reward programs with the issuers. Once a user selects a desired product the exchange computer can mediate or manage the purchase transaction in which reward points are redeemed by the selected issuer and consideration is conveyed to the merchant in exchange for the merchant providing the product to the user.

What is claimed is: 
     
       1. A method of an exchange computer executing a purchase transaction with a user computer, a merchant computer, and a reward issuer computer, comprising:
 an exchange computer receiving from a user computer a selection of an item for purchase from a merchant computer at a listed price and a bid comprising a quantity of reward points from a user reward account stored on a reward issuer computer that are offered for redemption towards purchase of the item from the merchant computer, the quantity of reward points bid by the user computer having a value to the reward issuer computer lower than the listed price of the item; 
 the exchange computer submitting the bid to the reward issuer computer; and 
 the reward issuer computer accepting the bid and paying for the item by reducing the user reward account by the quantity of reward points bid by the user computer and conveying consideration corresponding to the listed price to pay for the item. 
 
     
     
       2. The method of  claim 1  wherein the reward issuer computer conveys the consideration to the exchange computer, and
 the exchange computer pays the merchant computer towards purchase of the item from the merchant computer. 
 
     
     
       3. The method of  claim 1  wherein the reward issuer computer conveys the consideration to the merchant computer towards purchase of the item from the merchant computer. 
     
     
       4. An exchange system comprising an exchange computer for executing a purchase transaction with a user computer, a merchant computer, and a reward issuer computer, the exchange computer programmed to: receive from a user computer a selection of an item for purchase from a merchant computer at a listed price and a bid comprising a quantity of reward points from a user reward account stored on a reward issuer computer that are offered for redemption towards purchase of the item from the merchant computer, the quantity of reward points bid by the user computer having a value to the reward issuer computer lower than the listed price of the item; and
 submit the bid to the issuer computer; and 
 the reward issuer computer programmed to accept the bid and pay for the item by reducing the user reward account by the quantity of reward points bid by the user computer and conveying consideration corresponding to the listed price to pay for the item. 
 
     
     
       5. The exchange system of  claim 4  wherein the reward issuer computer is further programmed to convey the consideration to the exchange computer, and the exchange computer pays the merchant computer towards purchase of the item from the merchant computer. 
     
     
       6. The exchange computer of  claim 4  wherein the reward issuer computer is further programmed to convey the consideration to the merchant computer towards purchase of the item from the merchant computer.